Iran’s Minister of Petroleum Bijan Namdar Zanganeh (file photo)

Oil Minister: OPEC to coordinate itself to rise in Iran’s exports

TEHRAN (ISNA)- OPEC’s strategy of holding output steady is not working and the group’s members should discuss production levels before its next meeting in June, Iran’s oil minister said.

Oil prices have halved from $115 a barrel in June last year, in a drop that deepened after OPEC refused to cut output and defend market share. Saudi Arabia was the driving force behind the political decision.

“It seems (OPEC’s strategy of not cutting output) does not work well, because prices are coming down,” Zanganeh told Reuters during a visit to Beijing. “We haven’t witnessed stable situations on the market.”

Brent crude oil hit a near six-year low close to $45 in January. It was trading around $57 on Thursday, down from its 2015 high of $63.

OPEC, which pumps one third of the world’s oil, may soon have to deal with an increase in supply from Iran if Western sanctions over its nuclear program are lifted.

The group will be able to “coordinate itself” to accommodate Iran’s return without causing a price crash, said Zanganeh.

OPEC’s next meeting is on June 5.

Iran, once OPEC’s second-largest producer after Saudi Arabia, hopes to boost exports by as much as 1 million barrels per day (bpd) in just two months if there is a final agreement with world powers on its nuclear program and sanctions are lifted.

The Iranian minister arrived in Beijing just a week after Tehran and the world powers reached the framework nuclear deal to discuss oil sales and Chinese investments in Iran.

Higher sales to China, Iran’s biggest oil client and trade partner, would likely be on the cards with an end to sanctions.

Iran also hopes to resolve differences with Chinese energy companies on oil and gas projects in the Islamic republic, so that production can be ramped up again quickly.

By ISNA